Channelstructure Strategy

The channel-structure strategy refers to the number of intermediaries that may be employed in moving goods from manufacturers to customers. A company may undertake to distribute its goods to customers or retailers without involving any intermediary. This strategy constitutes the shortest channel and may be labeled a direct distribution strategy. Alternatively, goods may pass through one or more intermediaries, such as wholesalers or agents. This is an indirect distribution strategy. Exhibit 16-1 shows alternative channel structures for consumer and industrial products.

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